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Peterson Sends Positive Signals on Farm Bill

Tuesday, April 20, 2010

For years the Environmental Working Group has advocated for a more rational farm policy that would provide a better safety net for more American farmers. We've done this while also seeking to promote ecological sustainability and reduce perverse incentives that lead to environmental degradation. That’s why we’ve been encouraged by the initial statements by House Agriculture Committee Chairman Collin Peterson on what might be possible in the next Farm Bill. He has opened the door to new ideas, and we sincerely hope he will continue to welcome the kind of updated policies needed to bring America’s farm and food policies into the 21st century.

Thanks to EWG’s Farm Subsidy Database, it has become painfully clear that our farm programs benefit a very small swath of the agriculture sector. The vast majority of farm payments (70 percent) go to a narrow slice of the wealthiest top 10 percent of producers of the five major commodity crops – corn, soybeans, wheat, cotton and rice. Meanwhile, smaller farms -- the ones that most people typically think of as “family farms” -- and growers of fruits, vegetables and livestock get very little support, or nothing at all.

The current policy framework makes little sense. It consists of a patchwork of programs cobbled together and layered on top of one another over the years. For example, the federal government heavily subsidizes crop insurance to protect farmers against losses due to market failure or disastrous weather – to the tune of $5 billion last year – yet also pays out billions of dollars annually in supplemental “disaster” payments.

Similarly, this labyrinth of farm programs provides commodity crops with counter-cyclical payments that pay farmers when prices are low yet also offers favorable marketing loans that allow them to cash in when prices are high. And many farmers collect a direct payment entitlement regardless of what happens with prices -- or if they are not even growing a crop.

We don’t know what prompted Chairman Peterson to reconsider the outlandish framework he helped enshrine in the 2008 Farm Bill, and frankly his reasons are immaterial to EWG at the moment. We just look forward to working with him to help design a better, more rational alternative.

With that in mind, we thank Rep. Peterson for comments like those below, and we hope to hear more as he begins his new round of Farm Bill hearings tomorrow (April 21):

"What I've told people is that they should put everything on the table and we'll look at it. I think it's a useful exercise to take a look at how we're doing, and does it make sense for the future?" 4/19 E&E News

"I think there is pretty universal opposition on the committee to using EQIP [Environmental Quality Incentives Program] money to pay for [increased child nutrition funding, as was proposed in a Senate bill]." 4/16 Congress Daily

"One of the issues that needs to be looked at or addressed is, are these direct payments being capitalized into land values and rents? And is that making it more difficult for young farmers to get started?” 4/16 DTN Ag Policy

"People can understand you guys needing protection on your price and covering your production. They don't understand why people are getting payments just because you're farmers." 4/3 Capital Press

“Is it right to be doing this [crop insurance] by commodity, or should we be doing this with whole-farm type of situation with crop insurance and revenue? . . . You know, that would be a much more market-oriented type of approach where you could cover your own risk, but the decisions within what you do within your farm are your decisions, not some type of program you are planting towards.” 4/16 DTN

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